Hecla Shifts Focus Away From Grouse Creek Mining Firm Forges Ahead With Other Exploration Projects
On the heels of one of its largest quarterly losses ever, Hecla Mining Co. continues to explore other projects to nurse its earnings.
Hecla absorbed a $104.7 million third-quarter loss last Friday after discovering its Grouse Creek mine in central Idaho didn’t have the gold it once thought.
Hecla stock closed Thursday at $7.25, down 13 cents. That’s only 38 cents below where the stock finished last Friday, when third-quarter earnings were released, but almost $3 below its trading level before Hecla revealed the Grouse Creek disappointment Oct. 25.
Despite the large loss, work for the 151 Lucky Friday workers goes on.
Four thousand feet under the Lucky Friday silver mine head frame, crews are triple-shifting the Gold Hunter project. Once thought not to contain much silver/lead ore, the adjacent Gold Hunter mine showed encouraging signs when geologists drilled deeper in the late 1980s.
Crews are “drifting” or digging a tunnel more than 4,000 feet long to reach the ore body. They’re about halfway there now, said Tom Fudge, mine manager.
It’s not the easiest job in the world, he said. Temperatures in the unventilated drift hover around 107 degrees with nearly 100 percent humidity.
By January, crews will reach the Gold Hunter and begin to assess just how much silver is there.
If Gold Hunter proves promising, it could substantially increase the Lucky Friday’s silver and lead output without a corresponding increase in the cost of bringing the ore to the surface.
That would extend the mine’s life, preserve high-paying Silver Valley jobs and increase Lucky Friday’s profitability.
Beyond the Lucky Friday, Hecla hopes to find encouraging results at its Greens Creek mine in Alaska. Currently idle, the mine should be working by the beginning of 1997, said Vicki Veltkamp, manager of communications.
Hecla owns 30 percent of the project, but that share could net the company three million ounces of silver and 20,000 ounces of gold annually once under production.
“It’s just a big mine,” Veltkamp said. “We stand to gain a lot from it.”
Hecla’s La Choya mine in Mexico performed above expectations in the third quarter of this year.
Work continues at Hecla’s Golden Eagle project in northeast Washington, near its Republic gold mine that was closed last year after running out of ore. Santa Fe Pacific Gold continues to explore and develop the project with Hecla.
Hecla has all the environmental permits in place to develop the Rosebud gold project in northern Nevada, which could contain nearly 600,000 ounces of gold.